Need assistance to determine what formulas to use for the following questions

Name: UIN: Problem Set #2 (50 Points) AGEC 429 Due Date: Tuesday, March 3, 2020 There are two parts to this problem set. In Section I you are to calculate the impact of various agricultural policy instruments on U.S. rice markets. In Section 11 you are to write a 500 word (minimum) white paper addressed to the Secretary of Agriculture analyzing three of the proposals you analyzed in Section I. I. Costs of Policy Proposals (50%) In working these problems, assume that you are a policy analyst working for the Secretary of Agriculture. The information you need to answer the questions is given in the table below. Note that quantities are given in million hundredweight (cwt) and prices are given in $/cwt. You may not need all the information given in the table for every question. You must Show your work on one or more separate sheets and staple them to the problem set. Equilibrium price Before Rice Quantities and Prices elasticities Programs Supply (million cwt) 0.75 189.886 Demand (million cwt) 0.4 189.886 Farm Price ($lcwt) -- 10.00 Consumer price (SS/cwt) 10.00 Target Price ($lcwt) -- None Support Price ($lcwt) -- None Government Cost (mil $) -- None NOT : - = Not applicable. 1. The Secretary of Agriculture (Mr. Sonny Perdue) is considering recommending a surplus purchase program for rice to the President with a support price of $14.00/cwt. Before he submits his recommendation, he asks you to determine how much rice the government will have to purchase to support the price of rice at that level and what the cost to the government will be. Fill in the blanks below with your answers to the Secretary. Surplus to purchase = Cost to the government = 2. Congressman Drinksalot is proposing a marketing loan program instead of a government surplus purchase program to support price at a loan rate of $14.00/cwt because he claims it will cost the government less than the surplus purchase program. Secretary Perdue wants to know whether the Congressman is right and asks you to calculate the cost of the marketing loan program to the government. Fill in the blanks below with your answers to the Secretary. Cost of marketing loan program to the government: How much more or less will the Congressman's proposed program cost? Senator Cityslicker doesn't like the Secretary's government surplus purchase program proposal or Congressman Drinksalot's marketing loan program because she says both result in too much rice production and cost too much. She proposes a mandatory acreage reduction program to push the price of rice up to $14.00/cwt. Secretary Perdue asks you to calculate the total reduction in rice supply that would be required to push price to $14.00/cwt under Senator Cityslicker's plan. Supply reduction required = Cost of the Senator's program? = 2. point BONUS: Calculate the acreage reduction that would be required if there is 5% slippage. Supply reduction required with 5% slippage = The US Rice Producers Association proposes a government funded advertising campaign to promote domestic rice consumption. They propose that the slogan for the rice promotion program should be \"Try the sticky little white stuff that most of the rest of the world eats because you'll like it and besides it will help rice farmers." (Time to hire an advertising agency to come up with a better slogan!) Anyway. the Secretary wants to know how much more rice people will have to eat to get the price of rice up to $14.00/cwt. Fill in the blank below with your answer to the Secretary. Increased consumption required = Congresswoman Knowitall doesn't like the policy recommendations of the Secretary, Congressman Drinksalot, Senator City Slicker, or the U.S. Rice Producers Association. She proposes a price loss coverage (PLC) payment program with a reference price of $14.00/cwt and a NR loan rate set at a much lower $2.00/cwt safety net level because she says this program will lower the price to consumers like Congressman Drinksalot's proposed marketing loan program but will be cheaper than either the Secretary's or Congressman Drinksalot's programs. The Secretary asks you to determine if she is right. What would Congresswoman Knowitall' 5 proposed program cost? Is Congresswoman Knowitall right? - Does her program lower the price to consumers like the MLP? - How much cheaper or more expensive is her program than Secretary Perdue's proposed program? How much cheaper or more expensive is her program than Congressman Drinksalot' s proposed program